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Jury still out on whether a national FuelWatch scheme will deliver lower petrol prices.



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Media Contact: Greg Pierce 02 66 52 62 33 0408 532 785 Email:greg.pierce@aph.gov.au Canberra: 62 77 4447

Luke Hartsuyker MP Federal Member for Cowper

MEDIA RELEASE

March 31, 2008

Jury still out on whether a national FuelWatch scheme will deliver lower petrol prices

The Nationals Federal Member for Cowper, Luke Hartsuyker, today said he was cautious about the new Petrol Commissioner’s claim that a national FuelWatch scheme could cut the price of fuel by five cents a litre.

Mr Hartsuyker said while any move which eases the financial burden on motorists was welcomed, there remained conflicting evidence that a national FuelWatch scheme would effectively realise cheaper fuel prices.

“Kevin Rudd told Australians at the last election that he would put downward pressure on petrol prices but it remains unclear how he will deliver on that promise.

“Presently we have a regular weekly price cycle which sees the price of petrol bottom out each Tuesday and increase in price later in the week.

“According to The Australian Automobile Association, in 2007 the average difference between the peak and the trough in the weekly price cycle is 8.9 cents per litre.

“The AAA also says that 88 per cent of motorists are aware that petrol prices are cheaper on certain days and 71 per cent of these people correctly nominate Tuesday as the cheapest day.”

Mr Hartsuyker said the FuelWatch scheme, which currently operates in Western Australia, had changed the pricing cycle in that State but it did not necessarily translate into cheaper fuel for all motorists.

The Fuelwatch Scheme in Western Australia demands that at 2.30pm each day all petrol stations register the price they are going to charge from 6am the following day. Petrol stations are then prevented from altering prices.

“Whilst petrol stations increase their prices they also are unable to reduce them as well,” Mr Hartsuyker said.

“As a result what we have seen in Western Australia is that the difference between the maximum and minimum costs has decreased. Effectively the price is more stable.

Media Contact: Greg Pierce 02 66 52 62 33. Mobile 0408 532 785 Email: greg.pierce@aph.gov.au Canberra: 6277 4447

“Therefore, consumers who currently purchase their fuel on cheaper days could effectively be forced to pay more because the lower priced days no longer exist.

“Western Australia’s FuelWatch has also changed the regular weekly price cycle into a fortnightly cycle which means the lowest and highest prices exist over a 14 day period.

“When you consider that the majority of motorists buy fuel each week, then they will be forced to buy fuel at a higher price in the peak week.

Mr Hartsuyker said when it comes to the Rudd Labor Government, it is essential that one looks past their rhetoric and focuses on their actions.

“The Rudd Government recently moved to increase the fuel excise on trucks from 19.6 cents a litre to 21 cents.

“This is the first time that fuel excise has increased in any form since 2001 and highlights that when it comes to Labor, look not at what they say but rather what they do,” Mr Hartsuyker said.

“There is also speculation that the price of fuel will dramatically increase as a result of the Rudd Government’s climate change measures.

“Some industry commentators have speculated that an increase of 10 cents a litre or more will result from Mr Rudd’s carbon emissions trading scheme.

“If that is the case, it will effectively mean Kevin Rudd has conned the people of Australia into believing that he could deliver lower petrol prices.”

Ends